Leading Commercial Airlines and EcoVadis Launch The Sustainable Airlines Initiative

Rhea-AI Summary

Air France-KLM, Delta Air Lines, and Virgin Atlantic have launched the Sustainable Airlines Initiative (SAI) in partnership with EcoVadis to enhance sustainability practices across their value chains. SAI aims to address sustainability challenges, improve supplier engagement, and drive positive impact. The initiative promotes transparency, collaboration, and sustainable procurement best practices to achieve Net Zero CO2 emissions by 2050.

Insights

Environmental Sustainability Expert

Aviation is one of the industries most scrutinized for its environmental impact, particularly concerning greenhouse gas emissions. The Sustainable Airlines Initiative (SAI) represents a significant collaborative effort to address sustainability within the industry's supply chain. The initiative's focus on Net Zero CO2 emissions by 2050 aligns with the Paris Agreement's long-term goals and reflects a growing industry consensus on the urgency of climate action.

By leveraging EcoVadis' expertise in sustainability ratings, SAI aims to standardize and enhance transparency in supplier practices. This is crucial because the aviation industry's supply chain is complex, involving numerous global suppliers with varying sustainability standards. The initiative's approach, which involves collective assessments and scorecards, could streamline the process for suppliers, reducing redundancy and potentially lowering compliance costs.

However, the success of such initiatives often hinges on widespread adoption and the ability to drive tangible improvements in supplier behavior. The quarterly meetings for exchanging best practices and developing action plans are a step in the right direction, but the real test will be the measurable impact on sustainability metrics over time.

Supply Chain Management Expert

From a supply chain perspective, the SAI's approach to unify sustainability assessments can create efficiencies and foster industry-wide improvements. By having a common platform and standard, it reduces the burden on suppliers who otherwise might face multiple assessments from different airlines. This can lead to cost savings and faster onboarding, which are critical for maintaining a competitive edge.

Moreover, the initiative's emphasis on data mining solutions to track performance is a forward-thinking strategy that can lead to more informed decision-making. By analyzing supplier data, airlines can better identify risks and opportunities within their supply chain, leading to more strategic partnerships and innovation in sustainable practices.

However, the challenge lies in ensuring that the initiative has enough industry participation to set a de facto standard. Without a critical mass of airlines and suppliers on board, the initiative risks becoming a niche effort with limited influence on the overall market.

Investor Relations Specialist

For investors, the SAI could signal a long-term strategic advantage for its member airlines. Environmental, Social and Governance (ESG) factors are increasingly influential in investment decisions and airlines that lead in sustainability are likely to be more attractive to ESG-conscious investors. This initiative could enhance the reputation of its members and potentially lead to a premium on their stocks.

However, investors will also be keen to see how the initiative translates into financial performance. While sustainability efforts can lead to cost savings and operational efficiencies, they often require upfront investments. The balance between initial costs and long-term savings will be critical in evaluating the financial impact of the SAI.

Additionally, the initiative could serve as a risk mitigation tool, as it may reduce the likelihood of supply chain disruptions due to environmental or social issues. This proactive approach to sustainability could be a factor in reducing volatility and improving the resilience of the member airlines' operations and stock prices.

Air France - KLM group, Delta Air Lines, and Virgin Atlantic Join Forces to Improve ESG Performance Across Their Value Chains

PARIS & NEW YORK--(BUSINESS WIRE)-- Air France-KLM, Delta Air Lines and Virgin Atlantic today announced the launch of the Sustainable Airlines Initiative (SAI) in partnership with EcoVadis. Driven by members’ commitment to improve sustainability performance, the SAI will work to accelerate sustainable practices through close collaboration with trading partners to build transparency and scale positive impact across their value chains.

“Commercial aviation is critical for our economies and a conduit for connecting billions of people. The environmental and social crisis the planet is facing has elevated the need for innovation not only in more sustainable fuel but also in more sustainable and ethical business practices across the industry value chain,” said Annette Quincy, Director of Sector Initiatives at EcoVadis. “Through SAI, members entrust EcoVadis to coordinate their collective efforts so they can enhance supply chain visibility and drive improvement towards a more sustainable future for all.”

SAI seeks to solve core sustainability challenges faced by its value chain, including strengthening supplier engagement rates, accelerating suppliers’ performance improvement curve, and enhancing supplier engagement with a focus on key industry categories.

To achieve these goals, SAI selected EcoVadis to provide a common voice, standard and platform to improve sustainability performance throughout the industry’s value chain. EcoVadis will equip SAI with a proven sustainability rating methodology, tailored supplier assessments and scorecards and data mining solutions to track and improve the sustainability performance of industry suppliers.

The EcoVadis Sector Initiative features are built as an antitrust-compliant network and allow for more efficient supplier onboarding, transparency, collaboration and analytics. These capabilities give SAI visibility across the aviation supply chain's sustainability performance. SAI members will meet every quarter to exchange sustainable procurement best practices and to determine supplier-oriented improvement action plans. This results in a unified path for SAI members to make a positive impact within their community and on the environment and society.

“Achieving Net Zero CO2 emissions by 2050 is critical for our future, and for this the full participation of the entire supply chain is necessary. On top of fleet renewal, the incorporation of Sustainable Aviation Fuels and operational measures, SAI is one of our concrete sustainability initiatives. It sends a strong and unified call for action to our supply partners whilst also making it easier: an assessment for one airline is an assessment for all airlines in SAI. We are encouraging other airlines to join us and accelerate together our journey towards more transparent supply chains,” said Jurriaan Lombaers, SVP Procurement at Air France-KLM.

“At Virgin Atlantic, we’re on a mission to achieve Net Zero by 2050, recognizing the pivotal role we have to play in reducing our direct impact. Equally, understanding how our supply chain contributes and identifying opportunities to work towards future improvements is key. We’re proud to be accelerating this with the foundation of the Sustainable Airlines Initiative, alongside our joint venture partners,” said Caz Johnson - Procurement and Working Capital Director at Virgin Atlantic.

“In order to be an industry leader in creating a more sustainable future of travel, we know we must also lead in setting a standard of transparency and accountability with our business partners. The Sustainable Airlines Initiative enables Delta to send a strong signal to suppliers around our belief in the importance of engaging with partners who share in our values and will help to drive transparency at scale throughout our supply chain. We are thrilled to be founding members of the SAI alongside our partners at Air France-KLM and Virgin Atlantic, as we believe this is an important step in creating industry-wide positive impact through value chain engagement,” said Niteen Suresh, Managing Director, Supply Chain Management at Delta Air Lines.

The three SAI founding members collectively rated more than 700 suppliers upon the initiative’s founding in March 2023. SAI plans to expand this number to gain greater insight into the sustainability performance of its supply chain and drive maximum improvement.

The group welcomes new members from commercial passenger airlines who want to capitalize on the power of collaboration and advance their most strategic supply chain sustainability goals.

For more information about SAI, visit: the Sustainable Airlines Initiative Website

About EcoVadis

EcoVadis is a purpose-driven company whose mission is to provide the world's most trusted business sustainability ratings. Businesses of all sizes rely on EcoVadis’ expert intelligence and evidence-based ratings to monitor and improve the sustainability performance of their business and trading partners. Its actionable scorecards, benchmarks, carbon action tools, and insights guide an improvement journey for environmental, social and ethical practices across 200 industry categories and 175 countries. Industry leaders such as Johnson & Johnson, L’Oréal, Unilever, LVMH, Bridgestone, BASF and JPMorgan are among the 100,000 businesses that collaborate with EcoVadis to drive resilience, sustainable growth and positive impact worldwide. Learn more on ecovadis.com, Twitter or LinkedIn.

About Air France-KLM Group

Air France-KLM is committed to environmental and social responsibility for many years, with all of the Group’s commitments falling under its “Destination Sustainability” strategy. This strategy is founded on two major pillars: "people & culture” and “environment".

The Air France-KLM Group is a responsible company that cares for people and cultures by investing in noise pollution reduction, creating a safe and inclusive workplace, and supporting local communities.

The Air France-KLM Group has developed a decarbonization strategy to reduce its emissions per passenger kilometer by 30% in 2030, compared to 2019. To achieve this target, Air France-KLM is activating all decarbonization levers at its disposal, including:

Fleet renewal: Air France-KLM is investing in new-generation aircraft, such as the Airbus A220 and Airbus A350, which are more fuel-efficient and produce up to 25% less CO2 emissions, and with a noise level reduction of 33% on average. By 2028, these aircraft will account for 64% of the Air France-KLM Group fleet, thanks to an investment of two billion euros a year.

Sustainable Aviation Fuel (SAF): Air France-KLM is increasing its use of SAF, selecting projects which reduce CO2 emissions by at least 75% over the full life cycle, and which do not compete with the food chain. By 2030, the Group aims to incorporate at least 10% SAF in its operation, and 70% by 2050.

Operational measures: Including ground operations and eco-piloting measures, these initiatives, made possible by the action of Air France-KLM crews and ground staff trained in these practices, enable an average reduction of 4 to 5% in CO2 emissions.

About Delta Air Lines

Through the warmth and service of Delta Air Lines (NYSE: DAL) people and the power of innovation, Delta never stops looking for ways to make every trip feel tailored to every customer. 100,000 Delta people lead the way in delivering a world-class customer experience on over 4,000 daily flights to more than 280 destinations on six continents, connecting people to places and to each other. Delta expects to serve nearly 200 million customers this year safely, reliably and with industry-leading customer service innovation – recognized as North America’s most on-time airline. We’re dedicated to ensuring that the future of travel is connected, personalized and enjoyable. Our people’s genuine and enduring motivation is to make every customer feel welcomed and respected across every point of their journey with us.

Headquartered in Atlanta, Delta operates significant hubs and key markets in Amsterdam, Atlanta, Boston, Detroit, London-Heathrow, Los Angeles, Mexico City, Minneapolis-St. Paul, New York-JFK and LaGuardia, Paris-Charles de Gaulle, Salt Lake City, Seattle, Seoul-Incheon and Tokyo. As the leading global airline, Delta's mission to connect the world creates opportunities, fosters understanding and expands horizons by connecting people and communities to each other and to their own potential.

Delta has long been an industry leader in transforming a more sustainable, elevated future of travel on the journey to net-zero emissions by 2050. In 2023, Delta launched its metrics-based strategy to guide our short-, medium-, and long-term work that covers what we fly, how we fly, and the fuel we use.

The global airline has been a leader in spurring the production of sustainable aviation fuel (SAF) – the most important lever the industry has today to decarbonize aviation. So far, Delta has signed SAF agreements to meet more than half the volume needed to meet our goal of using 10% SAF by 2030 and has created a first-of-its-kind SAF Coalition in MSP. Additionally, Delta’s Carbon Council has spearheaded companywide efforts that have an immediate impact on reducing emissions, including enhanced winglet installations for drag reduction, weight reduction initiatives and flight routing/speed optimizations that saved a cumulative 21 million gallons of fuel already. A cumulative savings of more than 1B gallons is expected between 2019 and 2035.

Learn more about Delta’s Sustainability Strategy here.

About Virgin Atlantic

Virgin Atlantic was founded by entrepreneur Sir Richard Branson in 1984, with innovation and amazing customer service at its core. In 2023, Virgin Atlantic was voted Britain’s only Global Five Star Airline by APEX for the seventh year running in the Official Airline Ratings. Headquartered in London, it employs more than 7,500 people worldwide, flying customers to 30 destinations across four continents throughout the year.

Alongside shareholder and Joint Venture partner Delta Air Lines, Virgin Atlantic operates a leading transatlantic network, with onward connections to over 200 cities around the world. In February 2020, Air France-KLM, Delta Air Lines and Virgin Atlantic launched an expanded Joint Venture, offering a comprehensive route network, convenient flight schedules, competitive fares and reciprocal frequent flyer benefits, including the ability to earn and redeem miles across all carriers. Virgin Atlantic joined SkyTeam in March 2023 as the global airline alliance’s first and only UK member airline, enhancing the alliance’s transatlantic network and services to and from Heathrow and Manchester Airport.

Virgin Atlantic has been pioneering sustainability leadership for more than 15 years, committing to Net Zero by 2050 and continuous action that reduces environmental impact. The airline operates one of the youngest and most fuel-efficient fleets in the skies and has reduced its absolute carbon emissions by 35% over the last decade. In October 2022, Virgin Atlantic welcomed the first of 16 A330-900neos to the fleet, continuing its transformation towards 100% next generation aircraft by 2027. Later in 2023, Virgin Atlantic is led an industry consortium to deliver the first 100% SAF flight across the transatlantic. Demonstrating that 100% SAF can be used safely as a drop in fuel in existing infrastructure, engines and airframes. The need to scale production is an industry imperative and Virgin Atlantic is committed to radical collaboration across the energy chain to support commercialisation ahead of 2030.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240305362596/en/

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Source: EcoVadis

FAQ

What is the Sustainable Airlines Initiative (SAI) and who are the founding members?

The Sustainable Airlines Initiative (SAI) is a collaboration between Air France-KLM, Delta Air Lines, and Virgin Atlantic to improve sustainability practices across their value chains.

What is the goal of SAI?

The goal of SAI is to accelerate sustainable practices, enhance supplier engagement, and drive positive impact within the aviation industry's value chain.

How does SAI plan to achieve its goals?

SAI selected EcoVadis to provide a sustainability rating methodology, tailored supplier assessments, and data mining solutions to track and improve sustainability performance of industry suppliers.

What role does EcoVadis play in the SAI initiative?

EcoVadis equips SAI with tools for supplier engagement, transparency, collaboration, and analytics to improve sustainability performance throughout the aviation supply chain.

What is the significance of achieving Net Zero CO2 emissions by 2050 according to the SAI members?

SAI members emphasize the importance of achieving Net Zero CO2 emissions by 2050 and believe that the full participation of the entire supply chain is necessary to reach this goal.